Incorporeana: 2015

Friday 20 February 2015

Red vs Red

So, I’ve been learning Portuguese, for fun, and there haven’t been any interesting French cases recently that weren’t already well covered elsewhere, so I thought I’d have a go at a case in Portuguese. I came across an interesting recent case from Brazil, which touches on the same legal principles as my previous article, that is unfair competition. The decision was published on January 9th, and I’ve managed to find the case details on the Brazilian courts website, but there doesn’t seem to be a detailed decision published at least yet, so I’ve relied on secondary sources, principally Consultor Juridico, which is linked to in the references.

In 2011 a Brahma beer was released with a new can decoration, by Ambev. It was red, with their slogan. Subsequently, Petropolis released a new can for Itaipava beer, which normally came in white, but with a commemorative edition with sponsorship from Formula Stock Car which was red. Ambev claimed that this was confusing for consumers and was intended to take advantage of Brahma’s publicity. This therefore constituted unfair competition.
The suit was rejected at first instance as without merit. However, the Tribunal de Justiça of Rio de Janeiro, on appeal, said that Itaipava was exploting Brahma’s marketing, and that the competition was therefore parasitic and unfair. Petropolis appealed to the Superior Tribunal de Justiça.

The Superior Tribunal de Justiça is the highest federal appeal court in Brazil, for any case which does not require constitutional interpretation. When it is, the case can be heard by the  Supreme Court, the Supremo Tribunal Federal. The court said that it was clear from the Industrial Property Law that there was no exclusive right over any particular colour, and therefore it was possible for two competing products to use the same colour scheme.The name on the can, not simply the colour, is what distinguishes it from a competitor’s product.

To grant a business, even in this narrow context, exclusive use of the colour red would go against the spirit and purpose of the Industrial Property Law, which is to promote free competition. The judge, João Otávio de Noronha, said "a finalidade  da  proteção  do  uso  de  marcas  é  dupla:  por  um  lado protegê-la  contra  o  proveito  econômico  parasitário  e  o  desvio  desleal  de clientela  e,  por  outro,  evitar  que  o  consumidor  seja  confundido  quanto  à procedência  do  produto", which (avoiding extreme literalism) translates as “The aim of protecting trade marks is twofold. On one hand to protect against both being taken advantage of for another’s financial gain and against the unfair poaching of one’s clients, and on the other hand avoiding confusion on the part of the consumer as to the origin of the product”. On neither of these grounds could Ambev’s claim succeed.

References